How (and Why) You Should Teach Your Kids about Personal Finance

It’s often lamented that “kids these days” don’t know the value of a dollar, nor do they know how to properly save. If you currently have children living at home, a strong foundation in personal finance is one of the most important lessons you could teach them, one that will affect them for the rest of their lives. Not sure how to go about teaching them how to properly manage their money? Read on to find out!

Basics of Budgeting

First things first: if your kid doesn’t know how to set up a budget and follow it, then the rest of the financial lessons below probably won’t be taken too seriously. Budgeting can be a dry activity, but using a system of stickers or rewards (depending on your child’s age) can encourage them to stay positive and follow through on their goals. All it takes is a simple chart of their income and outflow and some mechanism for tracking their progress toward their savings goals.

Savings Habits: Start Young

Speaking of savings, one of the biggest problems facing teenagers and twentysomethings today is debt. Whether it’s from taking out too many student loans or abusing the credit card privilege, venturing out into the “real world” with a massive load of debt on your shoulders makes life much more difficult. To teach your kid the true value of saving money, start with the classic: an allowance. Getting money in exchange for work is a basic, but crucial lesson for later in life. If money is tight, consider restricting their allowance to a few dollars per week, and maybe even offer a parental match for every dollar saved (similar to the 401(k) match some employers offer as an incentive for their employees to save for retirement). This way, they’ll approach saving as a fun activity that can eventually lead to a big purchase, rather than seeing it as a chore.

Coupon Clipping 101

Who says coupons are only for adults? Although coupon clippers are generally portrayed as stay-at-home moms, the whole family can get involved! Whether it’s surfing online for coupons at sites like Sumo Coupon or browsing through stacks of newspapers for sweet deals, clipping coupons together as a family not only saves money when it comes time to shop, but it also encourages a frugal approach to shopping.

Encourage Entrepreneurial Spirit

Lemonade stands in summer, cookie and hot cocoa stands in winter. It seems simple enough; but why stop there? Kids have wild imaginations and what better way to harness that creativity than through a productive, entrepreneurial outlet? Whether it’s hosting an art show for family members and auctioning off their masterpieces, tutoring younger siblings or neighbors, cleaning yards/pools/houses/cars/etc., caring for animals (or, my personal favorite, setting up a balloon animal stand and selling creations at $1 each)…all of these are viable sources of income and teach kids to do more than wait for a job to appear; they have to go out and make their own opportunities.

Nip Impulse Purchases in the Bud

Kids and teenagers are notorious for exhibiting a lack of restraint when it comes to buying things they want (especially when it’s not their money). This bad habit, if left unchecked, could follow them into adulthood, spelling disaster for their finances. By teaching your kids the difference between “wants” and “needs” (as well as sticking to a budget, as mentioned previously), you could save them a lot of headache and debt later on.

Like What You See? Share the Story!

How (and Why) You Should Teach Your Kids about Personal Finance

It’s often lamented that “kids these days” don’t know the value of a dollar, nor do they know how to properly save. If you currently have children living at home, a strong foundation in personal finance is one of the most important lessons you could teach them, one that will affect them for the rest of their lives. Not sure how to go about teaching them how to properly manage their money? Read on to find out!

Basics of Budgeting

First things first: if your kid doesn’t know how to set up a budget and follow it, then the rest of the financial lessons below probably won’t be taken too seriously. Budgeting can be a dry activity, but using a system of stickers or rewards (depending on your child’s age) can encourage them to stay positive and follow through on their goals. All it takes is a simple chart of their income and outflow and some mechanism for tracking their progress toward their savings goals.

Savings Habits: Start Young

Speaking of savings, one of the biggest problems facing teenagers and twentysomethings today is debt. Whether it’s from taking out too many student loans or abusing the credit card privilege, venturing out into the “real world” with a massive load of debt on your shoulders makes life much more difficult. To teach your kid the true value of saving money, start with the classic: an allowance. Getting money in exchange for work is a basic, but crucial lesson for later in life. If money is tight, consider restricting their allowance to a few dollars per week, and maybe even offer a parental match for every dollar saved (similar to the 401(k) match some employers offer as an incentive for their employees to save for retirement). This way, they’ll approach saving as a fun activity that can eventually lead to a big purchase, rather than seeing it as a chore.

Coupon Clipping 101

Who says coupons are only for adults? Although coupon clippers are generally portrayed as stay-at-home moms, the whole family can get involved! Whether it’s surfing online for coupons at sites like Sumo Coupon or browsing through stacks of newspapers for sweet deals, clipping coupons together as a family not only saves money when it comes time to shop, but it also encourages a frugal approach to shopping.

Encourage Entrepreneurial Spirit

Lemonade stands in summer, cookie and hot cocoa stands in winter. It seems simple enough; but why stop there? Kids have wild imaginations and what better way to harness that creativity than through a productive, entrepreneurial outlet? Whether it’s hosting an art show for family members and auctioning off their masterpieces, tutoring younger siblings or neighbors, cleaning yards/pools/houses/cars/etc., caring for animals (or, my personal favorite, setting up a balloon animal stand and selling creations at $1 each)…all of these are viable sources of income and teach kids to do more than wait for a job to appear; they have to go out and make their own opportunities.

Nip Impulse Purchases in the Bud

Kids and teenagers are notorious for exhibiting a lack of restraint when it comes to buying things they want (especially when it’s not their money). This bad habit, if left unchecked, could follow them into adulthood, spelling disaster for their finances. By teaching your kids the difference between “wants” and “needs” (as well as sticking to a budget, as mentioned previously), you could save them a lot of headache and debt later on.

Like What You See? Share the Story!

Why You Should Go International with Your Online Business

There are businesses throughout the world competing with each other for the attention of their market. Businesses no longer remain local when trying to market their products. Unless you have a business selling services to a local audience, there is no reason why you should not engage the international stage with your company. In the worst case scenario, you do not make any money beyond the local population. In the best case scenario, you are able to start selling around the world to an ever-growing section of the population that loves what you have to offer. To make it work, make sure you are marketing effectively, work on shipping costs and be prepared to start ramping up production. If successful, you will be thankful you tried.

Market Effectively

One essential rule in business is that you cannot ever expect business to come to you, so you need to find ways to get more business. This means marketing to the people who are most likely to buy from you. Developing a good marketing solution means utilizing all the tools at your disposal. Make sure you include social media, blogs, good website design, videos and more in your marketing strategy. Also, make sure you are able to start marketing in more than one language. The more you are able to engage people in their native language, the easier it is going to be to bring in more attention for your business.

Work on Shipping Costs

Your profits vary a great deal if you are paying for shipping costs around the world as opposed to down the street. Keep this in mind as you are pricing items and when deciding how much you will charge to cover shipping and handling. One good way you can be sure you are lowering your shipping costs is through fulfillment shipping. This is where you ship a massive freight of goods to a country for a discounted rate. Once in the country, the goods are shipped as ordered for a lowered rate.

Be Prepared for More Work

If all of your efforts are successful, there is a good possibility you are in for a mountain of new work to accomplish. It will do no good to bring in a lot of orders and sales if you cannot even fulfill them. Start stockpiling products to ship out as soon as the orders start rolling in. This way, you will not be playing catch up. If you realize that the orders are coming in faster than you can make replacement products for your stockpile, start hiring people and creating new manufacturing methods. If you are lucky, your business will grow as you fill more requests and win the hearts of satisfied customers.

As long as you are marketing effectively, lowering shipping costs and preparing to be busy, you are ready to enter the International markets. Starting down this road can easily lead to an ever-growing business.

Like What You See? Share the Story!

Self-Sustainability

I think that many would agree with the statement, “This world is facing some large uncertainties in the near future.” Obviously that’s a pretty general statement, but who could disagree? Take a look at the debt of our surrounding countries? The USA had a national debt of $12 trillion in 2008. Now it has already sky-rocketed to $17 trillion! And, that number is not going to come down any time soon. It’s just going to keep growing! If the US self-destructs, then the rest of the world will probably end up coming down with it.

So What Can We Do?

As a single individual, there is not a lot you can do to change the national debt of a country. Heck, it might even be tough to impact the financials of your best friend. So, what power do you have to protect yourself and your investments? The best thing you can do is become self-sufficient and live on the resources that God gave you, rather than the artificial power and energy that is provided by large corporations and the government.

Now, I don’t want to be one of those radicals that has 5 years’ worth of dried food in their basement with riot gear and an assortment of guns. I’m not proclaiming doomsday. I’m just saying that it might be a wise idea to move your dependence from the government and take a little more responsibility for your own survival in this world. You could gain a lot from increasing your self-sustainability, and there’s really nothing to lose!

How to Become Self-Sustainable

For most of us, we live in a naturally green area that has water available right below our property. Why not install a well in your backyard? The water is completely free and you could use it to sprinkle your yard, water your garden, or even use it to freshen up if your city water fails on you.

Another area of self-sustainability is a garden (as I alluded to in the previous paragraph). You could grow many things that would provide nutrition to your body and it would keep some more money in your pocket (especially if you’re watering your plants will well water). You could grow green beans, tomatoes, squash, strawberries, and many other different varieties of fruits and veggies. Plus, by growing them yourself, you’ll know that there aren’t any pesticides that were used on them. You could grow them all-natural and do your body a favor in comparison to those genetically re-engineered fruits and veggies from the store.

So you might be wondering about electricity? Well, our early ancestors survived without it, so I’m sure you could too. As long as you have a fireplace in your home, I bet you could make it through each season just fine. If, however, you simply couldn’t do without it, there always is the option of solar panels. These can produce about half of your daily use of electricity today, so if you can find a way to survive on less, perhaps this would be a good way to go as well.

In short, don’t be the person that’s running around proclaiming that the world is going to end, but just to be safe, do your due diligence in creating a more sustainable lifestyle. The more you can provide for yourself, the safer you will be, no matter what happens or doesn’t happen in the future.

Like What You See? Share the Story!

Do Energy Efficient Light Bulbs Save You Money?

A few years ago, energy efficient light bulbs flooded the market and everyone jumped in line to buy them and save money. I wasn’t so sure though. It was clear that this ‘technology breakthrough’ cost more per bulb than the regular incandescent lights, so was there really savings to be had? I decided to make the purchase because I knew they would save energy, but how much money would I actually save?

Let’s Check the Costs

In order to see if we’re truly saving money with the energy efficient light bulbs vs. the incandescent bulbs, we need to find out what the average cost is for each. As expected the energy saving bulbs are fairly pricey at $2 a bulb, and the incandescent bulbs are less than half the cost at about 75 cents each.

How Long Does Each Bulb Last?

Alright, so as we expected, the energy saving bulb costs more than double, so now the question is, “How much longer will it last?” The old-school bulb will last only 1,000 hours and the new bulb will last ten times that amount at 10,000 hours!

Savings Per Year

The energy efficient bulb lasts 9,000 more hours than the traditional bulb, but what does this mean for our savings? How much does it cost to illuminate a light bulb for an hour? On average, electricity costs 12 cents per kilo-watt hour. By itself, that means absolutely nothing to me, so let’s find out how much it would costs to illuminate one light bulb for an entire year with this 12 cent/kWh cost.

One 60 watt light bulb might stay on for about 6 hours a day each day for the year. So, that’s 60x6x365, and it equals 131.4 kilo-watt hours. Multiply that by 12 cents and you’ll find out that your one light bulb is costing you about $16 per year.

The equivalent wattage of an energy efficient light bulb is 13 watts. Multiply that by 6 hours per day and 365 days per year and you’ll use up 28.5 kilo-watt hours, which will cost you about $3.50, which is saving you approximately $12 per year on that one bulb!

Savings Per Bulb

The above example shows you your savings per year, but I wonder what the overall savings is per bulb since the energy saving bulb lasts so much longer. The traditional bulb costs only 75 cents and lasts 1,000 hours. The energy saving bulb costs $2 and lasts 10,000 hours.

One traditional 60-watt will last 1,000 hours, which means it uses up 60 kilo-watt hours and costs $7.20. To match the length of the energy efficient bulb (10,000 hours), we’ll have to use 9 more, which will cost us a total of $72 in energy and $7.50 in bulbs. That’s a grand total cost of $79.50.

The energy efficient bulb will last 10,000 hours with 13 watts, which uses up 130 kilo-watt hours and costs $15.60. Add the cost of the bulb and you have a grand total of $17.60. Energy efficient bulbs will end up saving you over $60 per bulb!!! Who knew?

 

Like What You See? Share the Story!